Malaysia’s Real GDP To Grow Between Five And 5.5 Pct In 2018

KUALA LUMPUR, Oct 27 (Bernama) – Malaysia’s real gross domestic product (GDP) is expected to grow between five and 5.5 per cent in 2018 led by domestic demand, the Ministry of Finance said. It said private sector expenditure would continue to be the primary driver of growth with private investment and consumption growing at 8.9 per cent and 6.8 per cent, respectively, while public sector expenditure is expected to decline in line with lower capital outlays by public corporations. “In line with fiscal consolidation efforts, the fiscal deficit will further decline to 2.8 per cent of GDP in 2018 from three per cent this year,” it said in the Economic Report 2017/2018 released Friday. Accordingly, it said the federal government debt remained sustainable within the prudent limit of 55 per cent of GDP. On the supply side, it said growth is expected to be broad-based with all sectors registering positive growth. Malaysia's external position is forecast to remain favourable supported by global growth trade. Against this backdrop, the nominal gross national income (GNI) per capita is expected to increase by 5.1 per cent to RM42,777 (US$1 = RM4.24) next year from RM40,713 this year, and savings-investment gap narrowing to 2.3 per cent of GNI driven by the faster investment growth. “The economy will continue to operate under conditions of full employment with an unemployment rate of below 4.0 per cent, while inflation remains benign,” it said. These developments will further strengthen the nation's economic fundamentals and resilience to further propel the country towards the milestones of an advanced and high-income nation by 2020, doubling the size of the economy to RM2 trillion in 2025 and joining the ranks of top 20 countries by 2050. Meanwhile, the global economy is expected to expand 3.7 per cent next year from 3.6 per cent this year, while advanced economies are projected to register growth of 2.0 per cent in 2018 compared with 2.2 per cent in 2017 supported by strong domestic and external demand. It said GDP in the emerging market and developing economies is expected to improve 4.9 per cent next year from 4.6 per cent this year, mainly supported by higher global demand and rising market confidence, particularly in China, India and ASEAN. “However, the global economy will still face some downside risks due to policy uncertainties in the major economies, rising protectionism, geopolitical tensions, the effects of climate change, and volatility in the financial markets,” it added. – BERNAMA